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Two weeks ago, Moody's indicated Australia's rating was safe for now. However, it warned that if fiscal deterioration was not reversed, it could eventually pose sovereign credit risks.

Parliamentary secretary to the treasurer Kelly O'Dwyer says the government takes such warnings seriously.

She says most of the savings the government wanted to make in last year's budget are still held up in the Senate by the Labor Party, totalling $30 billion.

Liberal Democrats senator David Leyonhjelm believes the government can achieve its agenda without the Senate's obstruction by putting savings into bipartisan appropriations legislation.

That would allow it to make cuts to corporate welfare and reduce the size of the public service.

"It would be possible for the government to achieve quite significant savings, to bring it back into balance," Senator Leyonhjelm told AAP.

Commonwealth Securities chief economist Craig James has also warned that while the government is constrained in cutting personal taxes because of the size of the budget deficit, more "ordinary taxpayers" risk paying more tax if nothing is done about bracket creep.

Latest statistics from the tax office show more than 186,000 taxpayers were pushed into higher tax brackets in 2012-13 than the previous year, many through bracket creep, Mr James said.

"The latest data should escalate calls for tax reform, especially a shift from income tax to indirect tax such as the GST," he said in a note to clients.